Car loan FAQ

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What is a car loan and how does it work?

A car loan (also referred to as a secured car loan) involves a finance company lending you the money to purchase a vehicle for personal use. The loan is secured against the vehicle and, when the final repayment has been made, you will own the vehicle outright.

What are the benefits of a car loan?

Benefits include:

Flexible loan repayment periods, ranging from two to 10 years

The option to reduce monthly repayments by setting a final balance (Residual Value) payment

Choice of a fixed or variable interest rate

The option to put down either a lump sum or your current vehicle as a deposit to reduce the amount borrowed

The potential to claim tax deductions if the car is being used for business purposes

Lower interest rates, thanks to the loan being secured against the vehicle

Quotes and approvals available online

What tax and GST can I expect to pay on a car loan?

A car loan is classed as a personal finance product, however, it may still be possible to claim a tax deduction on your payments, depending on how frequently you use your vehicle for business purposes. For more information about claiming vehicle-related tax deductions, please visit the ATO website.

Who should choose a car loan?

A car loan is a good option for someone who uses their vehicle mainly for personal purposes, but who does not have the option of salary packaging a car through a novated lease.